TaxTMI 
TaxTMI 
2018 (2) TMI 1517
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....s; Project management services; and Post - construction service * The said services were to be performed both from India as well as from the United Kingdom ('UK'). The local services were rendered through independent Indian subcontractors and the foreign services were rendered partly by an independent foreign subcontractor i.e. Appledore and partly by the Assessee, from its head office in the UK. * Fees for the said services were payable in two parts i.e. foreign currency payment in USD and local currency payments in INR. * The work on the said contract was started in April 2004 and the Assessee has since been filing tax returns in India for incomes earned from the said contract. 2. The issues that arose for consideration in the aforesaid appeals was regarding taxability in India of the sums received from GRSE for services rendered under the contract referred to in the earlier paragraph. 3. By a common order dated 6.4.2016 the Tribunal held that the sums received from GRSE accrued and arose in India and that the same is taxable in India as Fees for Technical Services (FTS). The Tribunal further held that FTS has to be taxed....
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....e Act..... 5. In paragraph 72 & 73, the Tribunal concluded on the issue of taxability of FTS as follows: "72. Having come to the conclusion that there was no PE of the Assessee in India during the relevant previous year, the question that would now require consideration is with regard to taxability of the FTS under Article 13(2) of the treaty. A reading of Article 13(2) of the DTAA (reproduced in the earlier part of this order) would show that taxation has to be in according with the Act. The provisions contained in the Act in this regard are Sec.115A of the Act. In this regard, the relevant provisions of section 115A of the Act, needs to be looked into. We have already reproduced the provisions of Sec.115A of the Act and Sec.44AD of the Act in the earlier part of this order. U/S.115A of the Act, Income by way of FTS received by a non resident would be taxed at 20% on gross basis only if all the following conditions are satisfied:- i) the income is received from Government or an Indian concern in pursuance of an agreement; ii) Such agreement was made after 31st day of May, 1997 but before the 1st day of June, 2005; and iii) such income does no....
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....pplication was filed on 17.03.2017 whereas the order of the Tribunal was passed on 06.04.2016. As per the provision of section 254(2) of the Act as amended by the Finance Act, 2016 w.e.f. 01.06.2016 an application for rectification of apparent errors in the order of the tribunal has to be filed within six months from the end of the months in which the order was passed. Prior to the aforesaid amendment, an application for rectification of mistake apparent on the record could be filed at any time within four years from the date of the order. Since the present miscellaneous application has been filed after the aforesaid statutory amendment by the Finance Act, 2016, a question that was raised was as to whether the MA's would be barred by time under the amended provision of law. 8. On this aspect after considering the rival submissions we conclude as follows :- Section 254(2) of the Act of 1961 prior to the amendment by the Finance Act, 2016 w.e.f.1.6.2016 reads as under:- "254(2) The Appellate Tribunal may, at any time within four years from the date of the order, with a view to rectifying any mistake apparent from the record, amend any order passed by it under sub-section ....
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.... delivered by their lordships in the M.P. Steel Corporation (Supra), in the present case also the new law of limitation providing a shorter period cannot certainly extinguish a vested right of action. 09. The amendment has been made effective virtually in case of assessee with retrospective effect though the amendment does not show that it is applicable with retrospective effect, however, the existing right has been extinguished with retrospective effect in case of the assessee. 10. In the considered opinion of this Court, the legislature should have granted some time to the assessees who could have filed an appeal within a period of four years and the same has not been done till the amendment came into force extinguishing the right to file an appeal. 11. In the considered opinion of this Court, application preferred by the assessee should not have been dismissed by the Tribunal on account of the amendment which has reduced the period of limitation of four years to six months. 12- Resultantly, the impugned order passed by the respondent on 23/12/2016 is hereby quashed and the writ petition stands allowed. The Income Tax Appellate Tribunal is directed to d....
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....red in holding that, the entire amount received by the Appellant, including those in United States Dollar ( 'USD '}was attributable to the alleged PE in India and taxable under section 44DA of the Income Tax Act, 1961. (the 'Act ').; III For that the authorities below erred that any income not attributable to the activities performed in India can be charged to tax in India or for any reason alleged or at all; IV For that the authorities below erred in holding that the Appellant's claims that that it did not have any PE in India or that the Income earned in respect of activities outside India in USD was not assessable in India, could not be entertained without filing a revised return. V For that the authorities below erred in disallowing Rs. 3,136,682 paid to M/s Appledore International Ltd for works carried out by them in the United Kingdom on the ground that the same was taxable in India and tax was required to be deducted thereon under section 195 of the Act. The reasons given for such disallowance are not sustainable on facts and law; VII For that the authorities below erred in disallowing a sum of Rs. 2,858,996 on the grou....
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....t with the contentions of the assessee on the taxability of FTS before the AO and the DRP as well as before the tribunal and in all these submissions made by the assessee, the issue with regard to the taxability of FTS at a concessional rate of 15% as per Article 13(2) or DTAA as against the higher rate of 20% of gross receipts u/s 115A of the Act was never raised by the assessee. It was the contention of the ld. DR that in the garb of the miscellaneous application, the assessee seeks to review of the order of the tribunal. For the above reasons the ld. DR prayed that the miscellaneous applications are without any merits and the same should be dismissed. 19. We have given a very careful consideration to the rival submission. At the outset, we notice that in the synopsis of the arguments filed by the assessee on 12.12.2012 in para 2.5, the assessee has taken a specific plea that FTS has to be taxed at a concessional rate of 15% of the gross receipts as per the provision of Article 13(2) of the DTAA as against higher rate of tax provided at 20% of gross receipts u/s 115A of the Act. The law is well settled that the powers of the tribunal u/s 254(1) of the Act are very wide and the....